5The sector
The rise of m-commerce     M-commerce shopping set to take off as smart phone usage booms     While m-commerce remains a s...
A growing part of the purchasing process     Although consumers remain slow to adapt to buying products using m-commerce, ...
M-commerce fuels multichannel shopping     Mobiles increase the probability of multichannel shopping by allowing for insta...
Multichannel shopping within the sectors     Today multichannel shopping is most evident in Electricals, however in the fu...
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The impact of mobile on multichannel retail. Rise of mCommerce

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Research commissioned by Webloyalty looks at the impact of mobile on multichannel retail. This section looks specifically at the rise of mCommerce.

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The impact of mobile on multichannel retail. Rise of mCommerce

  1. 1. 5The sector
  2. 2. The rise of m-commerce M-commerce shopping set to take off as smart phone usage booms While m-commerce remains a small channel in terms of overall online spend +51.2% accounting for just an estimated 0.6% of total online sales in 2009, it was the fastest growing channel over the last decade and is set to continue to grow +37.2% rapidly over the next few years as smart phone usage by the general public starts to become mainstream. +19.8% +2.5% As the smart phone population grows and new technology developments such 0.0% as 4G and NFC (Near Field Communication) improve the speed and Online Physical Mail M- TV convenience of using m-commerce as a shopping medium, the amount of people using mobiles to actually make purchases will increase. By 2014 we stores order commerce shopping estimate that the amount of people in the UK actively using mobiles to 2000-2009 average annual retail growth across various shopping methods purchase products will reach 3.2 million, almost three times the number in Note: M-commerce rate based on five year average 2005-2009 2009. However despite the projected growth of m-commerce over the next few 3.17 years, it will continue to remain only a small part of online sales. M- 2.99 commerce’s real value will come from the smart phone acting as a marketing 2.76 tool and multichannel integrator, allowing retailer’s to interact with customers more and connect with other channels, providing a substantial boost to online and store sales. 2.25 1.69 1.0823 2009 2010 2011 2012 2013 2014 UK m-commerce shopping population (millions)
  3. 3. A growing part of the purchasing process Although consumers remain slow to adapt to buying products using m-commerce, we expect the channel’s uptake across all parts of the purchasing process to increase rapidly over the next 5 years The population using mobile phones at any stage of the purchasing process increased 85% from 2009 to 2010. Growth was driven by the rise in popularity and number of smart phones available, retailers releasing dedicated mobile applications and growing confidence in using the channel. In 2010, mobiles were used by 16% of the population to research product, 79.3 77.3 prices, retailers and locations before embarking on a shopping trip, up from 71.8 12% in 2009. Researching whilst shopping, using services such as comparison sites is a fast growing trend, as is reserving product and collecting from a 62.9 store. By 2014 we expect that 79.3% of UK consumers will use m-commerce at any stage of the buying process, a 181% increase from 2009. 52.0 As confidence of using mobiles for online purchases grows so does the number of consumers who will actually buy using this channel, which we expect to rise 161% from 2009-2014. 28.2 2009 2010 2011 2012 2013 2014 9.8% % of UK population that uses m-commerce (at any stage of purchasing process) 3.8% 2009 2014 % of UK shopping population that shop online via mobile phone24
  4. 4. M-commerce fuels multichannel shopping Mobiles increase the probability of multichannel shopping by allowing for instant access to a retailer, providing information immediately and improved convenience Although m-commerce adoption rates are increasing rapidly, the volume of direct mobile transactions is expected to be small. However, the opportunities for m-commerce to benefit and enhance the multi-channel customer experience 35.1% are endless. As retailers develop m-commerce sites as extensions of their websites, access and product information becomes more readily available to the consumer. The chart below shows the type of things the consumer can now do 23.4% ‘on the go’. 11.3% 4.5% Research 2000 2005 2010 2014 Compare Availability Proportion of total retail sales going through multichannel 2000-2014 Price check Click & collect The convenience of using mobile on the go will inevitably drive up multichannel transactions. By 2014, we estimate that 35% of retail sales will be made using more than one channel up from just over 23% in 2010. Significantly, this means Purchase Social/Opinion consumers will put much more consideration into their buying, something retailers will need to take account of. Locate Mobiles enable and encourage consumers to shop using multiple channels.25
  5. 5. Multichannel shopping within the sectors Today multichannel shopping is most evident in Electricals, however in the future we expect a higher usage of multiple channels to support the purchasing process across many sectors As more consumers use multiple channels for their shopping it is vital that We expect multichannel shopping will become more retailers understand what role each channel plays in the overall decision making process. This will vary from retailer to retailer and from sector to sector. influential on more considered products, often with a larger ticket value. In broad terms, in sectors such as music and video where relatively intangible products are sold, stores will become far, far less important as the place of purchase and are already being rapidly replaced with online downloading or In the future, we expect multichannel shopping to become more influential, ordering. In electricals the picture is different: here the internet is used especially in Food & Grocery, Clothing and DIY. As consumers remain cautious extensively for checking but stores come into their own for ideas and inspiration about spending, more researching and comparisons will be done before a and for making actual purchases. Clothing is different again and in this sector we decision is made. Also as information becomes more readily available online and believe that both stores and online will be equal in terms of the role they play in researching on mobiles more sophisticated, the consumer will, quite organically, the decision making process. think about purchases more. The most preferred shopping source by sector The influence multichannel shopping has on sectors Food & Music & Electricals DIY DIYClothing Clothing THE FUTURE Grocery Video Electricals DIY Clothing Food & Music & Physical Physical Physical Physical Physical grocery video Online Online Online Online Online High impact Ideas &Inspiration x x x x x x x Check x x x x x x x LowPurchase x x x x x x x x impact 26
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